McCain says it’s time for wholesale reexamination of Goldwater-Nichols Act

The annual National Defense Authorization Act (NDAA) Congress sent to President Barack Obama on Tuesday contains nearly 100 separate provisions intended to reform the Defense Department’s acquisition system. But that’s just the start, say Capitol Hill’s top two Defense legislators.

In next year’s legislative cycle, the Senate will undertake a serious reexamination of the landmark Goldwater-Nichols Act, said Sen. John McCain (R-Ariz.), the chairman of the Armed Services Committee.

That piece of legislation is widely regarded as the most successful reform bill in the history of the Defense Department, and the package Congress passed this month already includes some reversions from the overhaul former Sen. Barry Goldwater — another Arizonan and former SASC chairman — helped to shepherd through Congress in 1986. This year’s NDAA would would decentralize Pentagon procurement decisions and revert some acquisition authority back to the military services.

But McCain said there is more to do.

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“Goldwater-Nichols was 30 years ago, and the one thing we’re committed to is a thorough and complete review of Goldwater-Nichols,” McCain told the Brookings Institution on Tuesday. “Overall, it was a great success, but times have changed and the challenges have changed. We’re going to start, as soon as we can, to conduct hearings so that we can make the changes that are necessary. And this is not as difficult as one might think.”

By “this,” McCain mostly means ensuring DoD’s weapons systems are delivered within a reasonable time and on budget. He’s hopeful, he said, because the Pentagon has shown in recent years that it can deliver vital systems quickly when it absolutely has to, a la the Mine-Resistant Ambush-Protected (MRAP) vehicles the Army and Marine Corps sent to Iraq and Afghanistan in order to counter extremely lethal roadside mines.

Indeed, this year’s bill would encourage more streamlined procurements by creating a new category of rapid prototyping programs that could be finished within five years and expanding the criteria in which DoD can use the  rapid acquisition authorities it applied to the MRAP program.

“We used an accelerated process. If we’d taken the 20-year route we used for the F-35, God knows what would have happened or how many more people would have died,” he said. “There’s already a model out there in some areas, and it’s a model of what we can do if we get the right process into the Pentagon.”

Some of the most significant changes Goldwater-Nichols made to the defense acquisition process were to centralize go-or-no-go decisions within the office of the then-new undersecretary of Defense for acquisition, technology and logistics at various points in a major program’s lifecycle and to put constraints on the uniformed service chiefs’ ability to influence acquisition decisions: their job, largely, has been to decide what they wanted a weapons platform to do and then leave the details to civilian acquisition professionals.

This year’s bill would alter both of those points. The service chiefs would take on the responsibility for balancing cost, schedule and performance on an ongoing basis throughout a program’s development. And starting in 2016, most milestone decisions for new programs would be delegated to the military departments’ assistant secretaries for acquisition unless the Secretary of Defense could make a convincing case that a program should be handled at a higher level.

“I don’t think anybody’s saying that we should just turn back the clock to what we had before and everything’s going to be perfect,” said Rep. Mac Thornberry (R-Texas), the chairman of the Armed Services Committee. “But it is true that pendulums swing, and right now, we’ve swung in the direction where we have more layers of bureaucracy that results in no accountability for any decision. We have to simplify so that somebody makes a decision and you can hold them accountable for a decision. I’ll also admit that we’re part of the problem. In the past, every time we’ve had a cost overrun, Congress sets up a new bureaucracy or new procedure to make sure that particular problem never happens again. We can’t do that anymore. Simplification and accountability is the way to go, not more checks and balances that just paralyze the system. That’s the direction we’re going to be going in over the next year.”

Thornberry said his committee will continue to focus on paring back documentation requirements and various other detritus Congress and the Pentagon have layered on to the acquisition system over the last several decades. He said the House will also focus on reducing the problem of concurrency, in which programs are thrown out of schedule and their costs balloon because they’re still undergoing major design changes at the same time they’re being procured.

Even this year’s bill would require the military services to make sure their programs are at certain levels of technological maturity before they cross key approval thresholds known as Milestone A and Milestone B.

“If it continues to take us 20 years to field a new airplane, that airplane is going to be hopelessly out of date by the time we get it in the air,” Thornberry said. “We’ve got to be more agile in fielding technology quicker, thinning out regulations and getting more value for taxpayer dollars. We have to get more of our work done up front instead of inventing as we go, but all of this is only a beginning. On a bipartisan basis, we’re all committed to doing much more. But even these first steps won’t happen if the bill doesn’t become law.”

And it’s highly unlikely that it will, at least in its present form.

Pentagon leaders are working under the assumption that the acquisition reform elements of the NDAA will be eventually enacted more-or-less as they are, but President Obama has promised to veto the overall bill because of an unrelated and ongoing dispute over the Budget Control Act.

Since Congress and the White House still have not agreed on a way to alter the automatic budget caps, the armed services committees opted to use off-budget funds from the Overseas Contingency Operation accounts in order to fully-fund the president’s Defense budget request.

That safety valve doesn’t exist for the government’s domestic agencies, so the administration has promised to veto any bills which envision the use of OCO as a budget cap workaround only for Defense. After all, the entire point of the Budget Control Act was to create equal pain for domestic and Defense programs in order to force Congress to find another way to reduce annual deficits.

But McCain said the NDAA is not the proper venue for that fight and that Obama should instead veto an eventual Defense appropriations bill if the administration and Congress remain at odds over what to do about the budget caps.

“This is an authorizing bill. This is not a money bill,” he said, “If the President has a problem with the level of appropriations, his disagreement is with the appropriators. This is a big bill. With all of the reforms with acquisition and pay and military retirement, it seems to me that he’s picked the wrong target.”

McCain and Thornberry both said they agree that Budget Control Act has been a ‘disaster’ for Defense budgeting and that they too would like to see funding increases beyond the budget caps for some domestic programs. They said they opted to authorize tens of billions in OCO funding in ways that clearly do not involve overseas contingencies only because the BCA remains the law of the land.

“Mac and I really dislike OCO too,” he said. “We’d like to see a multi-year budget plan instead of lurching from one year to the next to see whether the Budget Committee is going to approve OCO or not. More importantly, the military needs some consistency. How can the Pentagon plan for almost anything if they don’t know what the following year’s spending is going to be?  It’s a broken system.”